New players hit online music

Playboy, Barnes & Noble move into crowded space

NEW YORK — Playboy magazine and bookseller Barnes & Noble both have announced plans to expand into the booming online music retail business.

The magazine’s Playboy Online division has signed a deal with K-tel Intl. to create the Playboy/K-tel Music Store within the magazine’s online site Playboy.com. The store will offer 250,000 music titles, including K-tel’s proprietary music compilations.

The deal is financially the largest that Playboy Online has formed, the company said, noting that it could become the first seven-figure e-commerce deal struck by the service.

K-tel gains the benefit of the popularity of Playboy.com, which receives almost 60 million page views per month.

And by the first quarter of 1999, Barnes & Noble’s online arm barnesandnoble.com, which claims a customer base approaching 1 million, will also begin to offer a broad range of music and video selections, although the site will focus editorially on the book/video categories most popular in the book selling environment, including classical, jazz and show tunes as well as documentaries, travel, how-to and foreign films.

To support this new direction, Barnes & Noble, which has media conglomerate Bertelsmann, owner of the BMG music group, as a partner in its online operation, signed an exclusive agreement with the All-Music Guide/All-Movie Guide, publishers of print and online entertainment databases covering some 300,000 albums and 140,000 video titles.

Both the Playboy/K-tel and Barnes & Noble ventures come in the wake of the merger of online music retailers CDNow and N2K (Daily Variety, Oct. 26) and the positioning of all online music sellers against emerging giant Amazon.com, which claims a 4.5 million customer base. Last week, in its first full quarter of offering music online, Amazon.com reported sales of $14.4 million and now purports to be the No. 1 music retailer. But Tuesday, Amazon.com’s stock fell $4.75 to $126.25 in response to competitor news.

Both Playboy and K-tel already have online music ventures: CCMusic is the online extension of Playboy’s Collector’s Choice Music Catalog and K-tel launched online arm K-tel Express in May.

K-tel CEO Philip Kives also announced Tuesday the appointment of Lawrence Kieves as president. Kieves, who has held chief operating officer spots at Network Event Theater, RKO Video, L.A. Entertainment and Congress Video Group, replaces David Weiner, who left the company in September to pursue other interests. Kieves is a once-removed cousin of Philip Kives with an alternate spelling of the family name.